Statistics shows how much attractive Singapore’s business landscape is to entrepreneurs, both local and foreign alike. This is because the number of enterprises operating in Singapore continues to grow steadily over the years. The growth rate of businesses reaches 4.3% per year. By the end of 2016, the current count totals 216,900, with locals owning 84% and foreigners owning 16% of the total count. By the last quarter of 2017, Singapore’s enterprise population has further condensed, reaching a mark of 485,623.
Business Expectations in Singapore: Which Business Sector Should I Invest in?
One of the advantages of establishing business in Singapore is the immediate growth of investments and receipt of its returns. In a recent study, it was found that 7 out of 10 businessmen (mostly expats) easily profited from their start up in Singapore.
If you are thinking of setting up your own company in Singapore but undecided as to what industry to venture into, the first thing you should do is to understand a general business outlook on the various sectors in Singapore.
Fortunately, reports on business expectations are released every quarter to obtain the latest business outlook within the City. The corresponding compiled data found in these reports seek to ascertain the directional change of various industries and predict how firms from different sectors fare in the immediate future.
For 2017 and 2018, both the manufacturing and service-oriented industries have contributed greatly to the overall GDP growth of Singapore. In fact, by the third quarter of last year, both sectors already accounted for 77% of the State’s GDP.
In the manufacturing sector, electronics, precision engineering and semiconductor segments are expected to augment the economic expansion. According the Ministry of Trade and Industry, factory output surged to a whopping 18.4% in the third quarter of 2017, thanks in part to a higher global demand for chips used in assembling smartphone devices along with data storage and applications.
Mr. Song of the CIMB Private Bank, however, predicted that rapid expansion in factory output in 2017 will no longer be sustained in 2018. He qualified, however, that the manufacturing sector will still enjoy growth ranging from 4% to 7%.
On the other hand, the services-related sector which comprises two-thirds of the economy is expected to be the main economic driver in 2018, along with manufacturing. DBS Senior Economist Irvin Seah said that the new year will mark a turnaround in the services sector to make economic growth more sustainable and help accelerate the growth of the labour force.
Meanwhile, the construction sector may be the industry laggard for 2018, which is expected only to expand by 0.3%. Singapore Commercial Credit Bureau (SCCB) Chief Executive Officer Ms, Audrey Chia commented that the lacklustre performance of the construction industry may be attributed to a lack of demand for private commercial and industrial projects. In addition, there has been a reported weakness in both public sector and private sector building activities.
Information and communications industry, along with the health, education and social services, are expected to remain resilient in 2018.
Corporate Services Singapore: We’re Here to Help
If you want honest professional advice on Singapore’s most viable business sectors and learn the requirements of setting up an enterprise, talk to us. Our team of financial analysts, tax experts and corporate secretaries can help lay down your business foundation the right way. Contact us today!